Moving away from PPPs

THE government’s award of a contract to develop and operate the road charge and vehicle entry permit (VEP) system at the Malaysia-Singapore border is yet another example of how Malaysia’s approach to public-private partnerships (PPP) differs from that of countries like Singapore.

Across the causeway, the Singapore government handles its VEP system entirely on its own. It is managed by the Land Transport Authority (LTA).

All permits, the issuance of mandatory Autopass smart cards and the processing of vehicle documentation are processed through the LTA’s official digital platform.

The system, data and approvals are strictly government-run, without outsourced third-party administrative agencies.

Many other such services in Singapore are also managed by government agencies.

Malaysia’s approach has been different. The country frequently relies on the PPP procurement model.

Under this model, private vendors bid via a request for proposal process to undertake the upfront technical development, implementation and operational costs of systems.

On paper, PPPs help governments deliver essential infrastructure and services by combining public policy oversight with private-sector capital, innovation and operational efficiency.

They are used instead of direct government delivery to overcome public budget constraints, expedite project completion, and shift construction and operational risks to private enterprises.

However, it is questionable whether, in Malaysia’s case, sufficient risks are passed unto the private-sector partners.

Furthermore, across the billions of dollars worth of contracts dished out to private enterprises, has the government and the rakyat got their monies worth in terms of service quality and pricing?

Isn’t it time for the government to carry out more complex tasks internally?

Surely, something as straightforward as the VEP system at the Malaysia-Singapore border should be one such example.